Real Estate Investment Trust Securities Issuer
Sekisui House Asset Management, Ltd.
TEL: +81-3-6447-4870 (main)
Notice Concerning Acquisition of Asset (Equity Interest in an Anonymous Association)
Sekisui House Reit, Inc. ("SHR") hereby announces that Sekisui House Asset Management, Ltd. ("SHAM"), to which SHR entrusts management of its assets, has decided today for SHR to acquire the following asset (equity interest in an anonymous association) (hereinafter referred to as the "Asset Acquisition") as described below.
1. Summary of the Asset Acquisition
: Equity interest in an anonymous association with trust
beneficiary interest in trust asset which is comprised of domestic
real estate as the investment asset
: Payment of entire amount on the planned acquisition date
(Note) "Underlying asset" refers to 34.55% quasi co-ownership interest of the trust beneficiary interest in real estate regarding the compartmentalized ownership interest in all of the exclusively-owned portions of the 1st floor underground through 4th floor above ground and 11th floor through 19th floor above ground of the "Akasaka Garden City" building (hereinafter referred to as the "Property"), as well as the accompanying right of site (ratio of right of site: 662,768/1,000,000 (or approximately 66.3%)), and has not yet been acquired by SHR. The same applies hereinafter. Of the Property, SHR holds 65.45% quasi co-ownership interest of the trust beneficiary interest in real estate regarding the compartmentalized ownership interest in all of the exclusively-owned portions of the 1st floor underground through 4th floor above ground and 11th floor to 19th floor above ground as well as the accompanying right of site (ratio of right of site: 662,768/1,000,000 (approximately 66.3%)), and the trust beneficiary interest in real estate regarding the compartmentalized ownership interest in all of the exclusively-owned portions of the 5th to 9th floor as well as the accompanying right of site (ratio of right of site) : 273,490/1,000,000 (approximately 27.3%), and 96.05% quasi co-ownership interest of the trust beneficiary interest in real estate regarding the compartmentalized ownership interest in all of the exclusively- owned portions of the 10th floor and the accompanying right of site (ratio of right of site: 54,698/1,000,000 (approximately 5.5%)).
2. Reason for the Asset Acquisition
SHR conducts the Asset Acquisition based on the targets and policies of asset management stipulated in its Articles of Incorporation, with the aim of enhancing the "Office Building" portfolio in the medium- to long-term and securing external growth opportunities.
The real estate subject to the trust beneficiary interest, which will be the investment asset of the "equity interest
Disclaimer: This translation is for informational purposes only. If there is any discrepancy between the Japanese version and the English translation, the Japanese version shall prevail.
in anonymous association Godo Kaisha Gemini1" (the "Anonymous Association Equity"), is a part of "Akasaka Garden City" which SHR owns a portion of.
SHR is scheduled to acquire preferential negotiation rights regarding the acquisition of the trust beneficiary interests related to underlying asset by acquiring an investment stake in the Anonymous Association Equity. SHR believes that enhancing the "Office Building" portfolio by acquiring an environmentally-friendlylarge-scale office building in the future and securing growth potential through external growth will contribute to strengthening the earnings base from a medium-tolong-term perspective. Such preferential negotiation rights will be held by SHR as a right and SHR will not be obligated to acquire the underlying asset (however, acquisition by SHR is not guaranteed.). In addition, by acquiring the Anonymous Association Equity, SHR expects to receive dividend income distributed from profits generated by the real estate property-related operating income of the underlying asset.
The characteristics of the Property that were focused on when deciding to acquire the investment stake in the Anonymous Association Equity are as follows.
of electricity is necessary, with spaces for generators (maximum: 500 kVA) for providing power in case of disaster.
(Note) "Certification for CASBEE for Real Estate" is developed with the aim of utilizing the results of environmental evaluation of buildings in CASBEE (Comprehensive Assessment System for Built Environment Efficiency/ "Comprehensive Assessment System for Building Environmental Performance" for real estate evaluation. It is scored in five evaluation categories: "1. Energy/Global Warming Gas", "2.
Disclaimer: This translation is for informational purposes only. If there is any discrepancy between the Japanese version and the English translation, the Japanese version shall prevail.
Water", "3. Resource Use/Safety", "4. Biodiversity/Site" and "5. Indoor Environment". It is then graded "S Rank", "A Rank", "B+ Rank" or "B Rank". CASBEE is also a comprehensive assessment of building qualities, including consideration for indoor comfort and landscape, as well as environmental considerations, such as energy conservation and the use of materials and equipment with low environmental impact.
3. Description of the Anonymous Association Equity
Total amount of investments in
480 million yen (Equity interest ratio 12.4%)
・ Summary of the anonymous association investment
(Note 1) Trust beneficiary interest in real estate, etc. include expenses for obtaining trust
beneficiary interest related to the underlying asset, and costs for establishing
the anonymous association, etc. The real estate appraisal value (as of July 1,
(Note 2) Of the Anonymous association investment, etc., SHR plans to invest 480 million
(Note 3) Mitsubishi UFJ Trust and Banking Corporation is scheduled to become the asset
manager of the Godo Kaisha Gemini1.
The three-month period will be from February 1 to the end of April,
from May 1 to the end of July, from August 1 to the end of October, and
from November 1 to the end of January in the following year.
However, the first calculation period will be from July 28, 2022 to the
・ Distribution of profits and losses
In the event any profit arises in each calculation period, the business
operator will distribute it to the investors in accordance with the
investment ratio on the end of each calculation period. In addition, in
the event any loss occurs during each calculation period, the business
operator will, up to the amount of the loss, distribute such loss to the
investors in accordance with the investment ratio on the end of each
Disclaimer: This translation is for informational purposes only. If there is any discrepancy between the Japanese version and the English translation, the Japanese version shall prevail.
calculation period. However, in the event that the cumulative amount
of losses to be distributed to equity investors exceeds the total
amount of equity investment, the entire portion in excess will be
distributed to the business operator.
The right to negotiate preferential purchase in the trust beneficiary
interest related to the underlying asset to be acquired by the business
operator on August 2, 2022, by the end of February 2027.
A reasonable amount with a base price of 16,300 million yen agreed
upon by Godo Kaisha Gemini1 and SHR.
34.55% of quasi co-ownership interest in real estate trust beneficiary
Sumitomo Mitsui Trust Bank, Limited
Appraisal value (Date of value)
Tanizawa General Appraisal Institute, Inc.
4-15-1, Akasaka, Minato-ku, Tokyo
4-1500-1 Akasaka, Minato-ku, Tokyo
Commercial district, Category 1 residential district
Right of site (co-ownership interest)
S, SRC, RC / B2F / 19F (Note 2)
A pledge will be established with the lender of the non-recourse loan
to Godo Kaisha Gemini1, the business operator, as the pledgee.
Status of leasing and management
Kenedix Property Design, Inc. (planned) (Note 4)
From August 2, 2022 to June 30, 2029 (planned)
Disclaimer: This translation is for informational purposes only. If there is any discrepancy between the Japanese version and the English translation, the Japanese version shall prevail.
Outline of building engineering report (Note 5)
Japan Constructive Inspect Association, Inc.
Outline of earthquake PML appraisal
Japan Constructive Inspect Association, Inc.
Building designer, constructor, building inspector
JAPAN ERI CO., LTD., The Building Center of Japan
・ Along with the disposition of the trust beneficiary interest of the underlying asset from Sekisui House, Ltd. ("Sekisui House") to Godo Kaisha Gemini1, the contractual status and rights and obligations of Sekisui House under the quasi co-owners agreement between Sekisui House, SHR, and Sumitomo Mitsui Trust Bank, Limited will be assumed by Godo Kaisha Gemini1 (collectively referred to as the "Agreement" in this section). Preferential negotiating rights will be agreed upon between the two parties.
The outline of the Agreement is as follows.
a. In the event that Godo Kaisha Gemini1 or SHR seeks to dispose of the quasi co-ownership interest to a third party, the party seeking to dispose (the "offeror" in this section) must notify the other party (the "counterparty" in this section) of the terms and conditions and other information related to the concerned disposition before any negotiations of disposition take place with a third party and, if the counterparty requests consultations concerning purchase of the quasi co-ownership interest, the offeror shall hold consultations on the terms and conditions of disposition in good faith with the counterparty and no negotiations concerning disposition of the quasi co-ownership interest shall take place with a third party during the prescribed consultation period. Furthermore, only if an offer to acquire is not made to the offeror from the counterparty within the prescribed consultation period or if consultations fail to reach an agreement may the offeror be entitled to dispose the quasi co-ownership interest to a third party; provided, however, that the terms and conditions of the concerned disposition shall not be of more advantageous content to the third party than the terms and conditions notified to the counterparty above.
b. In the event of failure to perform the obligations provided for in the Agreement, Godo Kaisha Gemini1 or SHR shall be entitled to notify the other party that the obligations be performed and, if the concerned obligations are not performed within the prescribed period, to request that the quasi co-ownership interest held by the other party be disposed with compensation.
c. In order for Godo Kaisha Gemini1 or SHR to dispose or transfer to a third party, provide as collateral or otherwise dispose of its quasi co-ownership interest without undergoing the procedures described in a. above, it shall obtain consent from the counterparty.
d. In the event that Godo Kaisha Gemini1 or SHR is to dispose part of the quasi co-ownership interest not to the counterparty but to a third party, the third party shall succeed to the status under the Agreement to the extent of the ratio of quasi co-ownership interest subject to the concerned disposition.
e. Certain matters including disposal of trust beneficiary, establishment of mortgage or lien, repair work which exceeds certain amount and change of agreements executed by trustee in connection with the Property need mutual agreement between SHR and Godo Kaisha Gemini1.
f. In the event that co-ownership interest in the Property is returned from trustee to beneficiary in kind, claims on division of co-ownership parts in accordance with Article 256 of the Civil Code (Act No. 89 of 1896, as amended) will not be made for five years from the effective return date.
Disclaimer: This translation is for informational purposes only. If there is any discrepancy between the Japanese version and the English translation, the Japanese version shall prevail.
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Sekisui House REIT Inc. published this content on 28 July 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 28 July 2022 06:37:05 UTC.